In an effort to clear the air and bring more clarity on the Synohydro Agreement, the Vice president, Dr. Mahamudu Bawumia has taken time to break the agreement down in order to make it lighter for Ghanaians and interested persons to assimilate.
Below is the Vice President’s simplified explanation of the agreement.
“What this arrangement does basically, is to say that we agree with Sinohydro that they provide us with our choice of infrastructure worth $2 billion. The Sinohydro Corporation which is going to provide the infrastructure is not the company that is going to mine the bauxite and they are not taking our raw bauxite. In other words, Sinohydro is not a mining company.
Rather, government in our plans has set up a holding company backed by an Act of Parliament called the Ghana Integrated Aluminum Development Authority that will soon enter into a joint venture agreement with potential mining companies, aluminum refiners and off-takers to establish the bauxite mines and refinery.
After mining and refining, Government of Ghana will then use her share of the refined bauxite to pay-off whatever cost of the infrastructure provided by the Sinohydro Corporation. This will only happen after a period of three years and on condition that Sinohydro has completed the infrastructure projects that the people of Ghana has asked them to do.
So Sinohydro will be providing the infrastructure, but Ghana will choose its own partner to set up the integrated aluminium development industry. The partners could come from America, Australia, Canada, China, wherever. Once we are confident of the capacity of the potential partners, we can enter into partnership with them.”